What is non-economic loss (NEL)?

Non-economic loss (NEL) is a type of damages that relates to the impact of injuries on life, separate from lost income and out-of-pocket treatment expenses. Whether NEL is available depends on the applicable NSW CTP scheme rules.

Is NEL the same as pain and suffering?

People often use similar wording, but the legal availability and assessment of NEL depends on the scheme and thresholds. It is not automatic.

Is exactly 10.0% WPI treated the same as greater than 10%?

No. Exactly 10% does not satisfy the statutory requirement that impairment be greater than 10%.

Can I get NEL if the insurer disputes liability?

Damages claims generally require you to establish the necessary legal elements (including liability and causation). If liability is disputed, you may need a dispute determination through the appropriate pathway.

Should I settle without advice if NEL may be in issue?

Because settlement can finalise rights, it is usually sensible to obtain advice before agreeing where WPI, non-economic loss, prognosis or future economic loss remains unresolved.

What is the most useful way to organise NEL evidence?

Keep the WPI gateway evidence separate from evidence about the impact of the injury. Organise the impairment report, causation and pre-existing evidence, then records showing pain, loss of amenities, daily function, treatment, work and care needs.

The insurer says one "good day" means my non-economic loss claim is overstated. How should I answer?

Treat one good day as a data point, not the conclusion. Use contemporaneous medical and functional records to show the ordinary pattern: preparation, duration, symptom rebound, support required and whether the activity can be repeated reliably.

Non-economic loss (NEL) in NSW CTP claims

Non-economic loss (NEL) is a category of damages that may be available in serious NSW CTP claims. It is separate from economic loss (lost income) and separate from statutory benefits like weekly payments and treatment expenses.

Section 1.7 of the Motor Accident Injuries Act 2017 provides that NEL damages cannot be awarded unless permanent impairment caused by the motor accident is greater than 10% WPI. Exactly 10% is insufficient. That medical gateway is separate from threshold injury classification and the other legal requirements for a damages claim.

Last updated: 10 July 2026. NEL is a damages-stage issue, not a statutory weekly-benefits payment. A person must still address fault, causation, the separate damages claim and evidence of loss. General information only.

Permanent impairment report and functional evidence being reviewed for non-economic loss in a NSW CTP claim. — Non-economic loss requires the WPI gateway, liability, causation and evidence of non-financial impact to be considered as separate issues within the damages pathway.

What NEL is

This section explains what non-economic loss is in a NSW CTP damages pathway. NEL is intended to recognise the non-financial impact of injury on a person’s life (as defined by the applicable legal framework). It is not the same as reimbursement for treatment costs and it is not weekly income support.

How thresholds interact with NEL

The greater-than-10% WPI requirement applies specifically to non-economic loss. It does not decide whether an injury is threshold or non-threshold and should not be described as a general threshold for all damages. Physical and psychiatric impairment are assessed separately and cannot be combined to satisfy the test.

Read: greater-than-10% WPI test for NEL.

Evidence issues

The WPI gateway should be supported by a method-specific impairment report addressing permanence, accident causation, pre-existing impairment, examination findings and calculations. Evidence about the amount of NEL is a different task: treating records and practical examples may show pain, loss of amenities, reduced independence, sleep effects, care needs and restrictions on family, social or recreational life.

In practice, stronger NEL-ready files usually separate out the different issues: medical impairment material for WPI assessment, records about daily function and independence, and insurer correspondence showing whether the real fight is about liability, threshold classification, or access to the broader damages pathway.

Common dispute points where NEL is in issue

the insurer says the injury remains threshold, so the separate common law damages pathway is not open
medical evidence is incomplete, inconsistent, or too old to support a serious ongoing impact case
liability or contributory-negligence issues reduce confidence about the ultimate damages outcome
the claim is pushed toward early resolution before the interaction between WPI, treatment prognosis, and future loss is clear

The next step depends on the decision. A threshold classification or WPI opinion may require a medical dispute pathway; liability, economic loss and settlement issues have separate damages procedures. Do not assume one internal review or PIC application resolves every issue.

What to do after an insurer says NEL is not available

Obtain the written reasons and identify whether the issue is threshold injury, WPI, accident causation, liability or the evidence about non-financial impact. Use the review date stated in the decision and obtain advice promptly if it is unclear, close or already passed.

Get the insurer rationale in writing (threshold/WPI, liability, causation, or evidence insufficiency).
Split issues into separate workstreams: threshold and impairment, liability/contributory negligence, and functional impact evidence.
Build an indexed evidence pack for the review or medical-dispute pathway that actually applies.
Avoid signing early settlement terms until the NEL pathway position is properly tested.

Frequently asked questions

What is non-economic loss (NEL)?: Non-economic loss (NEL) is a type of damages that relates to the impact of injuries on life, separate from lost income and out-of-pocket treatment expenses. Whether NEL is available depends on the applicable NSW CTP scheme rules.
Is NEL the same as pain and suffering?: People often use similar wording, but the legal availability and assessment of NEL depends on the scheme and thresholds. It is not automatic.
Do I need WPI > 10% to claim NEL?: Yes under section 1.7 of the Motor Accident Injuries Act 2017: damages for non-economic loss cannot be awarded unless permanent impairment caused by the motor accident is greater than 10%. This does not mean greater than 10% WPI is required for every damages component.
Is exactly 10.0% WPI treated the same as greater than 10%?: No. Exactly 10% does not satisfy the statutory requirement that impairment be greater than 10%.
Can I get NEL if the insurer disputes liability?: Damages claims generally require you to establish the necessary legal elements (including liability and causation). If liability is disputed, you may need a dispute determination through the appropriate pathway.
Should I settle without advice if NEL may be in issue?: Because settlement can finalise rights, it is usually sensible to obtain advice before agreeing where WPI, non-economic loss, prognosis or future economic loss remains unresolved.
What is the most useful way to organise NEL evidence?: Keep the WPI gateway evidence separate from evidence about the impact of the injury. Organise the impairment report, causation and pre-existing evidence, then records showing pain, loss of amenities, daily function, treatment, work and care needs.
The insurer says one "good day" means my non-economic loss claim is overstated. How should I answer?: Treat one good day as a data point, not the conclusion. Use contemporaneous medical and functional records to show the ordinary pattern: preparation, duration, symptom rebound, support required and whether the activity can be repeated reliably.

Assessment source

Which rules govern non-economic loss?

Assessment source: Motor Accident Injuries Act 2017 (NSW), section 1.7; Motor Accident Guidelines Part 6, particularly clauses 6.1-6.46, 6.19, 6.31-6.38 and 6.45, with the applicable body-system method.

Threshold injury: Non-economic loss is part of the common law damages pathway. It requires permanent impairment caused by the accident to be greater than 10% WPI. Exactly 10% is insufficient, and physical and psychiatric impairment cannot be combined to satisfy the test.

What the assessor checks

WPI is a medical gateway for NEL, not a formula for the amount of NEL damages.
The impairment report should address permanence, causation, pre-existing impairment and the correct Part 6 method.
Evidence about pain, loss of amenities and daily function is relevant to impact but does not replace the WPI assessment.
Economic-loss damages, liability and settlement questions remain separate issues.

What does not establish the result by itself

A non-threshold injury or receipt of statutory benefits used as automatic proof of damages.
Pain, imaging or surgery used to infer a WPI percentage without the prescribed method.
Adding physical and psychiatric impairment to cross the greater-than-10% test.
A single good or bad day used as the whole account of long-term impact.

WPI assessment Damages and compensation WPI disputes

Free case assessment (damages / NEL)

If a WPI decision may affect non-economic loss, send the assessment and insurer correspondence. We can identify the evidence and pathway without assuming an outcome.